ANZ Group Holdings Ltd (ASX: ANZ) shares have a reputation for paying a sizeable dividend yield. But, can the ASX bank share deliver capital growth too?
It's an interesting time for ASX bank shares with interest rate rises.
On one hand, it could make it harder for borrowers to afford the repayments and reduce demand for credit.
On the other hand, rate rises could boost the profit margins of the lending.
The net interest margin (NIM) tells investors how much profit a bank is making on the lending, including both the loan rate and the cost of funding the loan (such as savings accounts, term deposits, and transaction accounts).
When rates go up, banks like ANZ can lend out the transaction account balances for a higher rate, but it doesn't come at a higher cost (unlike savings accounts that are likely to experience a higher interest rate for savers).
ANZ did experience a profit boost in the FY26 third quarter, so let's remind ourselves what the ASX bank share reported.
FY26 third-quarter update
ANZ revealed that its operating income increased 2% (year over year) in constant currency terms for the three months to 30 June 2026, compared to the three months to 30 June 2025.
With operating expenses flat in constant currency terms, the business was able to report profit before provisions growth of 4% and cash profit growth of 3%. Its bottom line was affected by 6% year-over-year growth of the provision charge to $102 million.
ANZ reported that excluding markets, net interest income grew by 2%, reflecting both volume growth and an increase in net interest margins. Excluding markets, the group NIM rose by 4 basis points.
In that quarter, customer deposits grew by $15 billion (2%) comparing the balance at 30 June 2026 to March 2026. Excluding markets, deposits were flat. Net loans and advances rose $24 billion (or 2%). Excluding markets, lending grew $12 billion (or 2%), including strong growth in the business and private bank, which saw 4% growth in the quarter.
What could happen to the ANZ share price?
According to CMC Invest, there have been eight broker ratings on the ASX bank share in the last three months.
A price target tells investors where analysts think the share price will be in 12 months from the time of the investment call.
Of those eight broker ratings, the average price target is $35.91. That implies a possible decline of around 10% over the next year, at the time of writing. The most optimistic price target is $41.32, implying a rise of 4%, while the lowest price target is $33.26, suggesting a fall of 16%.
In other words, the professional investors think the ANZ share price is overvalued and there are better opportunities around.
The post How much could the ANZ share price rise in the next year? appeared first on The Motley Fool Australia.
Motley Fool contributor Tristan Harrison has no position in any of the stocks mentioned. The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.
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